Creating a High Performance Health System: The Importance of Delivery System Reform

Transcription

1 Creating a High Performance Health System: The Importance of Delivery System Reform David Blumenthal, MD, MPP President, The Commonwealth Fund db@cmwf.org National Association of Medicaid Directors Washington, DC November 13, 2013

2 Agenda 2 Challenges Alternatives Next Steps ACA Confronting Costs Implications for Medicaid Officials

3 3 COST $Billions in unnecessary and wasteful spending Overuse puts patients at risk, drains resources, and makes healthcare less accessible and less effective A BROKEN SYSTEM QUALITY Despite rapid advances, thousands of patients die each year from medical error COVERAGE 55 million uninsured; many more underinsured

4 4 30 Percent of Working-Age Adults Uninsured Now or During the Past Year Percent of adults ages Insured now, time uninsured in past year Uninsured now Note: Totals may not equal sum of bars because of rounding. Source: The Commonwealth Fund Biennial Health Insurance Surveys (2003, 2005, 2010, and 2012).

5 In 2012, Nearly Half of Adults Were Uninsured During the Year or Were Underinsured 5 Insured all year, not underinsured^ 54% 100 million Uninsured during the year* 30% 55 million Insured all year, underinsured^ 16% 30 million 184 million adults ages Note: Numbers may not sum to indicated total because of rounding. * Combines Uninsured now and Insured now, time uninsured in past year. ^ Underinsured defined as insured all year but experienced one of the following: out-of-pocket expenses equaled 10% or more of income; out-of-pocket expenses equaled 5% or more of income if low income (<200% of poverty); or deductibles equaled 5% or more of income. Source: The Commonwealth Fund Biennial Health Insurance Survey (2012).

6 250% 200% Cumulative Increases in Health Insurance Premiums, Workers Contributions to Premiums, Inflation, and Workers Earnings, Health Insurance Premiums Workers' Contribution to Premiums Workers' Earnings Overall Inflation 196% 6 182% 150% 117% 119% 100% 50% 0% 56% 57% 50% 34% 14% 40% 29% 11% SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April), ; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, (April to April).

7 U.S. Health in International Perspective: Shorter Lives, Poorer Health 7 Americans live shorter lives and are in poorer health at any age Poor outcomes cannot be fully explained by poverty or lack of insurance White, insured, college-educated, and upper income Americans are in poorer health than their counterparts in other countries

8 Huge Geographic Variabililty in Health System Performance 8 Source: D. Blumenthal, Two Americas, (New York: The Commonwealth Fund, August 2013).

9 Overall Health System Performance for Low Income Populations 9 Source: Commonwealth Fund Scorecard on State Health System Performance for Low-Income Populations, 2013.

10 International Comparison of Spending on Health, Average spending on health per capita ($US PPP) Total expenditures on health as percent of GDP US SWIZ NOR NETH GER CAN FRA SWE AUS UK NZ $8, US FRA NETH SWIZ GER CAN NZ UK NOR SWE AUS 17.0% % $3, Note: $US PPP = purchasing power parity. Source: Organization for Economic Cooperation and Development, OECD Health Data, 2013 (Paris: OECD, June 2013).

11 U.S. Health Spending is Larger Than the GDP of Most Nations 11 Notes: Data from 2011, adjusted for differences in cost of living Source: D. Blumenthal and R. Osborn, In Pursuit of Better Care at Lower Costs: The Value of Cross-National Learning, (New York: The Commonwealth Fund Blog, April 2013).

12 Compelling Need to Eliminate Waste in US Health Care 12 Source: Berwick DM, Hackbarth AD. Eliminating Waste in US Health Care. JAMA. 2012;307(14):

13 Looking Back: What We Could Have Saved if We Had Matched the Next Highest Country (Switzerland) 13 Increase spending on public health by 20,000% Note: Per capita spending amounts adjusted for differences in cost of living, total U.S. savings adjusted for inflation. Source: D. Squires, The Road Not Taken: The Cost of 30 Years of Unsustainable Health Spending Growth in the United States, (New York: The Commonwealth Fund Blog, March 2013).

14 14 Looking Forward: A Durable Reduction in Spending Growth Offers $770 Billion in Potential Public Sector Savings CMS actuary forecast At pre-recession growth ( ) At recent growth ( ) Source: Cutler DM, Sahni NR. If slow rate of health care spending growth persists, projections may be off by $770 billion. Health Aff (Millwood) May;32(5):

15 15 Health Policy at a Fork in the Road Benefit and Price Reduction OR Fundamental Delivery System Reform Regardless of how you envision the role of government, health care and the markets in which it s purchased need to be improved

16 16 Cost Control is Job 1 We can t approach our health system problems until we get costs under control

17 17 17 Improving Performance Microsystems Health System Performance Macrosystems

18 Microsystems 18 ICU OR ED MD practice Microsystems Admitting dept People, processes and practices that interact directly with patients or support patient care at the local level (the sharp end ).

19 Macrosystems 19 Organizations and environmental forces that support and influence microsystems (the blunt end ). Govt programs/ regulations Health plans Hospitals Macrosystems Accrediting organizations National boards

20 20 Interventions That Work: Microsystem Microsystems Toyota Production System

21 21

22 22 Macrosystems We have failed to create macrosystems that encourage and support use of these solutions, thereby changing the behavior of large numbers of microsystems and raising the performance of the health care system as a whole.

23 23 Fundamental Delivery System Reform We need to make it easier to do the right thing

24 24 24 Improving Performance Microsystems Health System Performance Macrosystems Affordable Care Act and State/Medicaid Policy

25 The Affordable Care Act 25 Reduced Payments for Avoidable Complications Value Based Purchasing Medicare Advantage Plan Bonuses Accountable Care Organizations Bundled Payments Hospital Inpatient Quality Reporting Physician Quality Reporting System Medical Homes Meaningful Use

26 Synergistic Policies to Stabilize Costs and Improve Outcomes 26 Goal: Create incentives and structures for better care and lower cost throughout the continuum of health care services Bite the Bullet: National per Capita Cost Target Three pillars: Payment Reforms to Accelerate Delivery System Innovation Policies to Expand and Encourage High-Value Choices Other Actions to Improve How Health Care Markets Function

27 One of Many Frameworks 27

28 Shared Approaches to Confronting Costs Provider payment reform Repeal Medicare sustainable growth rate formula Move from paying for volume to paying for value Enhance support for primary care Delivery system reform Encourage development and implementation of innovative delivery models Medicare reform Improve financial protection for beneficiaries Provide positive incentives for choosing high performing providers Consumer/patient engagement Enhancing performance of health care markets Increase transparency of quality and cost information Eliminate administrative inefficiency 28

29 Good News: Integrated Care Movement is Spreading 29 Hawaii Puerto Rico Note: the sum of the ACOs reflects the total number of unique, publicly identifiable, confirmed private-payer ACOs as of 08/2012 and public-payer ACOs as of 01/2013.

30 More Good News: Spending Growth Rate Has Slowed Recently 30 NHE per capita spending growth Source: Ryu AJ, Gibson TB, McKellar MR, Chernew ME. The slowdown in health care spending in reflected factors other than the weak economy and thus may persist. Health Aff (Millwood) May;32(5):

31 31 Many States are Actively Pursuing Delivery System Reform CMS State Innovation Models (SIM) Initiative provides funding and technical assistance to help states plan, design, and test new service delivery and payment models to advance broad health system reform Vermont Blueprint for Health includes medical home, bundled payment, ACO, and multi-payer initiatives Accountable Care Collaborative Program in Colorado encourages care coordination with shared savings and risk agreements ACOs in Minnesota entering into risk arrangements with Medicaid to achieve better health outcomes while being held accountable for the total costs of providing care to their patient populations Further initiatives in AZ, AR, and SC, among others

32 State Innovation Models (SIM) Initiative 32 CMMI launched SIM in July 2012 to assist states in planning, designing, and testing new payment and delivery system models to advance broad health system transformation. Emphasis on state flexibility while improving population health through multipayer models that integrate public health and community resources.

33 33 Medicaid/CHIP Participation in Accountable Care Models, Sept Source: CMWF supported NASHP tracking project:

34 Medicaid Medical Home Payments and Multi-Payer Initiatives as of Sept AK WA OR NV CA ID UT AZ MT WY CO NM ND MN SD IA NE KS OK WI IL MO AR MS MI OH IN KY TN AL GA VT NY PA WV VA NC SC ME NH MA RI NJ MD HI TX LA FL States with Multi-Payer Initiatives States making Medical Home payments Source: National Academy for State Health Policy.

35 More Delivery System Reform Models for Serving High Cost Patients On Lok Lifeways' PACE (Program of All-inclusive Care for the Elderly) Participants have access to medical care, social activities, exercise and meals at On Lok Lifeways centers 35 Commonwealth Care Alliance Offers a full spectrum of medical and social services for older people and the physically and mentally disabled Bridges to Health Model Divides the U.S. population into eight groups and offers a series of population-focused priorities Promoting Integrated Care for Dual Eligibles Expands the capacity and scalability of existing wellperforming integrated managed care plans that serve dual eligibles

36 36 New Payment Arrangements Offer Potential for New Focus on Population Health Acute care system won t adopt a true population health perspective, but there are opportunities Medical Services Social Services

37 Is This the Dawn of a New Day? 37

38 The Answer is Partially Up to You 38